Washington,
(MARK ONE)
xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨TRANSITION REPORT PURSUANT TO SECTION 13 September 30, 2021
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 87-2876494 | |
(State or other jurisdiction of
| (I.R.S. Employer Identification No.) | |
|
|
(347) 517-1041
Title of each | Trading Symbol(s) | Name of each exchange on which | ||
Common Stock, | ||||
SHPW | New York Stock Exchange | |||
Warrants, each whole warrant exercisable for one | SHPW WS | New York Stock Exchange |
Check
☐
☐
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
Emerging growth company | ☒ |
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☒
GALILEO ACQUISITION CORP.
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2020
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Item 4. | 36 | |||||
Item 1. | 37 | |||||
Item 1A. | 37 | |||||
Item 2. | 37 | |||||
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38 |
GALILEO ACQUISITION CORP.
March 31, 2020 | December 31, 2019 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 453,512 | $ | 712,062 | ||||
Prepaid expenses and other current assets | 175,678 | 129,666 | ||||||
Total current assets | 629,190 | 841,728 | ||||||
Cash and marketable securities held in Trust Account | 138,961,110 | 138,414,479 | ||||||
TOTAL ASSETS | $ | 139,590,300 | $ | 139,256,207 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current liabilities – Accrued expenses | $ | 53,215 | $ | 65,716 | ||||
Total Liabilities | 53,215 | 65,716 | ||||||
Commitments | ||||||||
Ordinary shares subject to possible redemption, 13,453,708 and 13,419,049 shares at $10.00 redemption value at March 31, 2020 and December 31, 2019, respectively | 134,537,080 | 134,190,490 | ||||||
Shareholders’ Equity | ||||||||
Preference shares, $0.0001 par value; 2,000,000 shares authorized; none issued and outstanding | — | — | ||||||
Ordinary shares, $0.0001 par value; 200,000,000 shares authorized; 3,946,292 and 3,980,951 shares issued and outstanding (excluding 13,453,708 and 13,419,049 shares subject to possible redemption) at March 31, 2020 and December 31, 2019, respectively | 395 | 398 | ||||||
Additional paid-in capital | 4,411,357 | 4,757,944 | ||||||
Retained earnings | 588,253 | 241,659 | ||||||
Total Shareholders’ Equity | 5,000,005 | 5,000,001 | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 139,590,300 | $ | 139,256,207 |
The accompanying notes are an integral partTable of these unaudited condensed financial statements.
GALILEO ACQUISITION CORP.
CONDENSED STATEMENT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2020
(Unaudited)
General and administrative costs | $ | 200,037 | ||
Loss from operations | (200,037 | ) | ||
Other income: | ||||
Interest earned on marketable securities held in Trust Account | 546,631 | |||
Net income | $ | 346,594 | ||
Weighted average shares outstanding of redeemable ordinary shares | 13,800,000 | |||
Basic and diluted net income per ordinary share, redeemable | $ | 0.04 | ||
Weighted average shares outstanding of non-redeemable ordinary shares | 3,600,000 | |||
Basic and diluted net loss per ordinary share, non-redeemable | $ | (0.06 | ) |
The accompanying notes are an integral part of these unaudited condensed financial statements.
GALILEO ACQUISITION CORP.
CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
THREE MONTHS ENDED MARCH 31, 2020
(Unaudited)
Additional | Total | |||||||||||||||||||
Ordinary Shares | Paid-in | Retained | Shareholders’ | |||||||||||||||||
Shares | Amount | Capital | Earnings | Equity | ||||||||||||||||
Balance – January 1, 2020 | 3,980,951 | $ | 398 | $ | 4,757,944 | $ | 241,659 | $ | 5,000,001 | |||||||||||
Change in value of ordinary shares subject to possible redemption | (34,659 | ) | (3 | ) | (346,587 | ) | — | (346,590 | ) | |||||||||||
Net income | — | — | — | 346,594 | 346,594 | |||||||||||||||
Balance – March 31, 2020 | 3,946,292 | $ | 395 | $ | 4,411,357 | $ | 588,253 | $ | 5,000,005 |
The accompanying notes are an integral part of these unaudited condensed financial statements.
GALILEO ACQUISITION CORP.
CONDENSED STATEMENT OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 2020
(Unaudited)
Cash Flows from Operating Activities: | ||||
Net income | $ | 346,594 | ||
Adjustments to reconcile net income to net cash used in operating activities: | ||||
Interest earned on marketable securities held in Trust Account | (546,631 | ) | ||
Changes in operating assets and liabilities: | ||||
Prepaid expenses and other current assets | (46,012 | ) | ||
Accrued expenses | (12,501 | ) | ||
Net cash used in operating activities | (258,550 | ) | ||
Net Change in Cash and cash equivalents | (258,550 | ) | ||
Cash and cash equivalents – Beginning of period | 712,062 | |||
Cash and cash equivalents – End of period | $ | 453,512 | ||
Non-Cash investing and financing activities: | ||||
Change in value of ordinary shares subject to possible redemption | $ | 346,590 |
The accompanying notes are an integral part of these unaudited condensed financial statements.
GALILEO ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2020
(Unaudited)
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Galileo Acquisition Corp.This Quarterly Report on Form 10-Q (the “Company”) is a blank check company incorporated in the Cayman Islands on July 30, 2019. The Company was formed for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (a “Business Combination”). The Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination.
As of March 31, 2020, the Company had not yet commenced any operations. All activity through March 31, 2020 relates to the Company’s formation, the preparation of the initial public offering (“Initial Public Offering”“Report”), which is described below,including, without limitation, the section titled “Management’s Discussion and identifying a target company for a Business Combination. The Company generates non-operating income in the formAnalysis of interest income from the proceeds derived from the Initial Public Offering.
The registration statement for the Company’s Initial Public Offering was declared effective on October 17, 2019. On October 22, 2019, the Company consummated the Initial Public OfferingFinancial Condition and Results of 13,800,000 units (the “Units” and, with respect to the ordinary shares included in the Units sold, the “Public Shares”), whichOperations,” includes the full exercise by the underwriters of their over-allotment option in the amount of 1,800,000 Units, at $10.00 per Unit, generating gross proceeds of $138,000,000 which is described in Note 3.
Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 4,110,000 warrants (the “Private Warrants”) at a price of $1.00 per Private Warrant in a private placement to Galileo Founders Holdings, L.P. (the “Sponsor”) and EarlyBirdCapital, Inc. (“EarlyBirdCapital”), generating gross proceeds of $4,110,000, which is described in Note 4.
Transaction costs amounted to $3,187,305, consisting of $2,760,000 of underwriting fees and $427,305 of other offering costs. In addition, at March 31, 2020, cash of $453,512 was held outside of the Trust Account (as defined below) and is available for working capital purposes.
Following the closing of the Initial Public Offering on October 22, 2019, an amount of $138,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Warrants was placed in a trust account (the “Trust Account”) and invested in U.S. government securities,forward-looking statements within the meaning set forth inof Section 2(a)(16) of the Investment Company Act, with a maturity of approximately six months, or in any open-ended investment company that holds itself out as a money market fund meeting the conditions of Rule 2a-7 of the Investment Company Act of 1940, as amended, or the Investment Company Act, as determined by the Company, until the earlier of: (i) the consummation of a Business Combination or (ii) the distribution of the Trust Account, as described below.
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The Company’s initial Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (excluding taxes payable on income earned on the Trust Account) at the time of the signing of an agreement to enter into a Business Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance that the Company will be able to successfully effect a Business Combination.
The Company will provide its shareholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a shareholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The shareholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then on deposit in the Trust Account ($10.00 per share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations).
The Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if the Company seeks shareholder approval, a majority of the outstanding shares voted are voted in favor of the Business Combination. If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Memorandum and Articles of Association, offer such redemption pursuant to the tender offer rules27A of the Securities Act of 1933, as amended (the “Securities Act”) and Exchange Commission (“SEC”), and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination.
GALILEO ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2020
(Unaudited)
Notwithstanding the foregoing, if the Company seeks shareholder approval of the Business Combination and the Company does not conduct redemptions pursuant to the tender offer rules, the Company’s Amended and restated Memorandum and Articles of Association provides that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined in Section 13(d)(3)21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of present or historical fact included in or incorporated by reference in this Report, regarding the future financial performance of Shapeways Holdings, Inc. (the “Company”), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the Public Shares.
The Sponsor and the other initial shareholders (collectively, the “initial shareholders”) have agreed (a) to vote their Founder Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination; (b) not to propose, or vote in favor of, an amendment toas well as the Company’s Amendedstrategy, future operations, future operating results, financial position, estimated revenues, and Restated Memorandumlosses, projected costs, prospects, plans and Articlesobjectives of Association with respect tomanagement are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “continue,” “could,” “may,” “might,” “possible,” “potential,” “predict,” “should,” “would,” “will,” “seek,” “target,” and other similar words and expressions, but the Company’s pre-Business Combination activities prior to the consummationabsence of a Business Combination unless the Company provides dissenting public shareholders with the opportunity to redeem their Public Shares in conjunction with any such amendment; (c) not to convert any Founder Shares (as well as any Public Shares purchased during or after the Initial Public Offering) into the right to receive cash from the Trust Account in connection with a shareholder vote to approve a Business Combination (or sell any shares in a tender offer in connection with a Business Combination if the Companythese words does not seek shareholder approval in connection therewith) ormean that a vote to amend the provisions of the Amended and Restated Memorandum and Articles of Association relating to shareholders’ rights or pre-Business Combination activity and (d) that the Founder Shares shall not participate in any liquidating distributions upon winding up if a Business Combinationstatement is not consummated. However, the initial shareholders will be entitled to liquidating distributions from the Trust Account with respect to any Public Shares purchased during or after the Initial Public Offering if the Company fails to complete its Business Combination.
forward-looking.
In orderthe Company. These risks and uncertainties include, but are not limited to, protect the amounts heldthose factors described in the Trust Account,section titled “Risk Factors” in the Sponsor has agreedfinal joint proxy statement/consent solicitation statement/prospectus filed by Galileo Acquisition Corp. with the U.S. Securities and Exchange Commission (the “SEC”) on September 7, 2021 (the “Proxy Statement”) as well as elsewhere in this Report. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be liablerequired under applicable securities laws. These risks and others described in the section titled “Risk Factors” in the Proxy Statement may not be exhaustive.
September 30, 2021 | December 31, 2020 | |||||||
(Unaudited) | ||||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 90,108 | $ | 8,564 | ||||
Restricted cash | 143 | 145 | ||||||
Accounts receivable | 1,114 | 185 | ||||||
Inventory | 573 | 727 | ||||||
Promissory note due from related party | 0 | 151 | ||||||
Prepaid expenses and other current assets | 1,908 | 1,910 | ||||||
Total current assets | 93,846 | 11,682 | ||||||
Property and equipment, net | 1,090 | 948 | ||||||
Right-of-use | 982 | 2,102 | ||||||
Goodwill | 1,835 | 1,835 | ||||||
Security deposits | 175 | 175 | ||||||
Total assets | $ | 97,928 | $ | 16,742 | ||||
Liabilities and Stockholders’ Equity (Deficit) | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 1,168 | $ | 1,633 | ||||
Accrued expenses and other liabilities | 3,700 | 3,319 | ||||||
Current portion of long-term debt | 39 | 8,332 | ||||||
Operating lease liabilities, current | 631 | 1,222 | ||||||
Deferred revenue | 658 | 753 | ||||||
Total current liabilities | 6,196 | 15,259 | ||||||
Operating lease liabilities, net of current portion | 499 | 1,094 | ||||||
Warrant liabilities | 6,777 | 0 | ||||||
Long-term debt | 88 | 2,236 | ||||||
Total liabilities | 13,560 | 18,589 | ||||||
Commitments and contingencies | 0 | 0 | ||||||
Stockholders’ equity (deficit) (1) | ||||||||
Preferred stock ($0.0001 par value; 10,000,000 shares authorized; NaN issued and outstanding as of September 30, 2021 and December 31, 2020, respectively) | 0 | 0 | ||||||
Common stock ($0.0001 par value; 120,000,000 shares authorized; 48,296,484 and 32,170,068 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively) | 5 | 3 | ||||||
Additional paid-in capital | 195,121 | 112,994 | ||||||
Accumulated deficit | (110,442 | ) | (114,567 | ) | ||||
Accumulated other comprehensive loss | (316 | ) | (277 | ) | ||||
Total stockholders’ equity (deficit) | 84,368 | (1,847 | ) | |||||
Total liabilities and stockholders’ equity (deficit) | $ | 97,928 | $ | 16,742 | ||||
(1) | Retroactively restated for the reverse recapitalization as described in Notes 1 and 3. |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenue, net | $ | 7,716 | $ | 8,107 | $ | 25,354 | $ | 23,028 | ||||||||
Cost of revenue | 4,055 | 4,406 | 13,271 | 13,030 | ||||||||||||
Gross profit | 3,661 | 3,701 | 12,083 | 9,998 | ||||||||||||
Operating expenses | ||||||||||||||||
Selling, general and administrative | 4,366 | 2,461 | 10,513 | 8,075 | ||||||||||||
Research and development | 1,673 | 1,516 | 4,099 | 4,289 | ||||||||||||
Amortization and depreciation | 33 | 37 | 100 | 113 | ||||||||||||
Total operating expenses | 6,072 | 4,014 | 14,712 | 12,477 | ||||||||||||
Loss from operations | (2,411 | ) | (313 | ) | (2,629 | ) | (2,479 | ) | ||||||||
Other income (expense) | ||||||||||||||||
Long-term debt forgiveness | 0 | 0 | 2,000 | 0 | ||||||||||||
Interest expense | (126 | ) | (141 | ) | (407 | ) | (444 | ) | ||||||||
Change in fair value of warrant liabilities | 5,088 | 0 | 5,088 | 0 | ||||||||||||
Interest income | 1 | 0 | 1 | 0 | ||||||||||||
Other income | 0 | 4 | 1 | 7 | ||||||||||||
Loss on disposal of assets | 0 | 0 | 0 | (4 | ) | |||||||||||
Total other income (expense), net | 4,963 | (137 | ) | 6,683 | (441 | ) | ||||||||||
Income (loss) before income tax benefit | 2,552 | (450 | ) | 4,054 | (2,920 | ) | ||||||||||
Income tax benefit | 0 | 0 | (71 | ) | — | |||||||||||
Net income (loss) | 2,552 | (450 | ) | 4,125 | (2,920 | ) | ||||||||||
Deemed dividend - Earnout Shares | (18,132 | ) | 0 | (18,132 | ) | — | ||||||||||
Net loss attributable to common stockholders | (15,580 | ) | (450 | ) | (14,007 | ) | (2,920 | ) | ||||||||
Net income ( per share:loss) | ||||||||||||||||
Basic | $ | 0.07 | $ | (0.01 | ) | $ | 0.11 | $ | (0.08 | ) | ||||||
Diluted | $ | 0.07 | $ | (0.01 | ) | $ | 0.11 | $ | (0.08 | ) | ||||||
Net loss per share attributable to common stockholders: | ||||||||||||||||
Basic | $ | (0.41 | ) | $ | (0.01 | ) | $ | (0.38 | ) | $ | (0.08 | ) | ||||
Diluted | $ | (0.41 | ) | $ | (0.01 | ) | $ | (0.38 | ) | $ | (0.08 | ) | ||||
Weighted average common shares outstanding: (1) | ||||||||||||||||
Basic | 37,932,345 | 35,787,986 | 37,351,244 | 35,660,635 | ||||||||||||
Diluted | 37,932,345 | 35,787,986 | 37,351,244 | 35,660,635 | ||||||||||||
Other comprehensive ( loss) income | ||||||||||||||||
Foreign currency translation adjustment | (22 | ) | 65 | (39 | ) | 32 | ||||||||||
Comprehensive loss | $ | (15,602 | ) | $ | (385 | ) | $ | (14,046 | ) | $ | (2,888 | ) | ||||
(1) | Retroactively restated for the reverse recapitalization as described in Notes 1 and 3. |
Preferred Stock | Common Stock | |||||||||||||||||||||||||||||||
Three and Nine Months Ended September 30, 2021 | Shares | Amount | Shares | Amount | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity (Deficit) | ||||||||||||||||||||||||
Balance at January 1, 2021 (as previously reported) | 22,579,695 | $ | 2 | 16,211,567 | $ | 2 | $ | 112,993 | $ | (114,567 | ) | $ | (277 | ) | $ | (1,847 | ) | |||||||||||||||
Retroactive application of reverse recapitalization | (22,579,695 | ) | (2 | ) | 15,972,696 | 1 | 1 | — | — | — | ||||||||||||||||||||||
Balance at January 1, 2021 (after effect of reverse recapitalization) | 0 | $ | 0 | 32,184,263 | $ | 3 | $ | 112,994 | $ | (114,567 | ) | $ | (277 | ) | $ | (1,847 | ) | |||||||||||||||
Issuance of Legacy Shapeways common stock upon exercise of stock options | — | — | 35,895 | — | 16 | — | — | 16 | ||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | 174 | — | — | 174 | ||||||||||||||||||||||||
Net income | — | — | — | — | — | 1,708 | — | 1,708 | ||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | (9 | ) | (9 | ) | |||||||||||||||||||||||
Balance at March 31, 2021 | 0 | 0 | 32,220,158 | 3 | 113,184 | (112,859 | ) | (286 | ) | 42 | ||||||||||||||||||||||
Issuance of Legacy Shapeways common stock upon exercise of stock options | — | — | 63,506 | — | 55 | — | — | 55 | ||||||||||||||||||||||||
Issuance of Legacy Shapeways convertible Series B-1 preferred stock resulting from exercise of warrants | — | — | 19,177 | — | 60 | — | — | 60 | ||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | 171 | — | — | 171 | ||||||||||||||||||||||||
Net loss | — | — | — | — | — | (135 | ) | — | (135 | ) | ||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | (8 | ) | (8 | ) | ||||||||||||||||||||||
Balance at June 30, 2021 | 0 | 0 | 32,302,841 | 3 | 113,470 | (112,994 | ) | (294 | ) | 185 | ||||||||||||||||||||||
Issuance of Legacy Shapeways common stock upon exercise of stock options | — | — | 1,113,029 | — | 481 | — | — | 481 | ||||||||||||||||||||||||
Issuance of Legacy Shapeways common stock upon conversion of convertible notes | — | — | 1,406,741 | — | 5,913 | — | — | 5,913 | ||||||||||||||||||||||||
Issuance of Legacy Shapeways common stock upon exercise of warrants | — | — | 212,234 | — | — | — | — | — | ||||||||||||||||||||||||
Issuance of Legacy Shapeways convertible Series D preferred stock upon exercise of warrants | — | — | 89,217 | — | — | — | — | — | ||||||||||||||||||||||||
Repurchase of Legacy Shapeways common stock | — | — | (19,226 | ) | — | (152 | ) | — | — | (152 | ) | |||||||||||||||||||||
Effect of Merger and recapitalization, net of redemptions and issuance costs | — | — | 5,691,648 | 1 | 10,035 | — | — | 10,036 | ||||||||||||||||||||||||
Issuance of common stock pursuant to PIPE financing, net of issuance costs | — | — | 7,500,000 | 1 | 64,936 | — | — | 64,937 | ||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | 438 | — | — | 438 | ||||||||||||||||||||||||
Net income | — | — | — | — | — | 2,552 | — | 2,552 | ||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | (22 | ) | (22 | ) | ||||||||||||||||||||||
Balance at September 30, 2021 | 0 | $ | 0 | 48,296,484 | $ | 5 | $ | 195,121 | $ | (110,442 | ) | $ | (316 | ) | $ | 84,368 | ||||||||||||||||
Preferred Stock | Common Stock | |||||||||||||||||||||||||||||||
Three and Nine Months Ended September 30, 2020 | Shares | Amount | Shares | Amount | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity (Deficit) | ||||||||||||||||||||||||
Balance at January 1, 2020 (as previously reported) | 22,579,695 | $ | 2 | 15,894,428 | $ | 2 | $ | 112,186 | $ | (111,399 | ) | $ | (360 | ) | $ | 431 | ||||||||||||||||
Retroactive application of reverse recapitalization | (22,579,695 | ) | (2 | ) | 16,026,831 | 1 | 1 | — | — | — | ||||||||||||||||||||||
Balance at January 1, 2020 (after effect of reverse recapitalization) | 0 | $ | — | 31,921,259 | $ | 3 | $ | 112,187 | $ | (111,399 | ) | $ | (360 | ) | $ | 431 | ||||||||||||||||
Issuance of Legacy Shapeways common stock upon exercise of stock options | — | — | 994 | — | — | — | — | — | ||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | 171 | — | — | 171 | ||||||||||||||||||||||||
Net loss | — | — | — | — | — | (1,435 | ) | — | (1,435 | ) | ||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | (61 | ) | (61 | ) | ||||||||||||||||||||||
Balance at March 31, 2020 | 0 | 0 | 31,922,253 | 3 | 112,358 | (112,834 | ) | (421 | ) | (894 | ) | |||||||||||||||||||||
Issuance of Legacy Shapeways common stock upon exercise of stock options | — | — | 141,270 | — | 47 | — | — | 47 | ||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | 190 | — | — | 190 | ||||||||||||||||||||||||
Net loss | — | — | — | — | — | (1,035 | ) | — | (1,035 | ) | ||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | 28 | 28 | ||||||||||||||||||||||||
Balance at June 30, 2020 | 0 | 0 | 32,063,523 | 3 | 112,595 | (113,869 | ) | (393 | ) | (1,664 | ) | |||||||||||||||||||||
Issuance of Legacy Shapeways common stock upon exercise of stock options | — | — | 68,555 | — | 21 | — | — | 21 | ||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | 183 | — | — | 183 | ||||||||||||||||||||||||
Net loss | — | — | — | — | — | (450 | ) | — | (450 | ) | ||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | 65 | 65 | ||||||||||||||||||||||||
Balance at September 30, 2020 | 0 | $ | 0 | 32,132,078 | $ | 3 | $ | 112,799 | $ | (114,319 | ) | $ | (328 | ) | $ | (1,845 | ) | |||||||||||||||
(1) | Retroactively restated for the reverse recapitalization as described in Notes 1 and 3. |
Nine Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Cash flows from operating activities: | ||||||||
Net income ( loss) | $ | 4,125 | $ | (2,920 | ) | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
Depreciation and amortization | 424 | 362 | ||||||
Loss on disposal of assets | 0 | 4 | ||||||
Stock-based compensation expense | 783 | 544 | ||||||
Non-cash lease expense | 696 | 1,586 | ||||||
Non-cash debt forgiveness | (2,000 | ) | 0 | |||||
Change in fair value of warrant liabilities | (5,088 | ) | 0 | |||||
Change in operating assets and liabilities: | ||||||||
Accounts receivable | (924 | ) | (763 | ) | ||||
Inventory | 173 | (102 | ) | |||||
Prepaid expenses and other assets | 83 | 337 | ||||||
Interest on promissory note due from related party | 0 | 50 | ||||||
Accounts payable | (512 | ) | (775 | ) | ||||
Accrued expenses and other liabilities | 853 | 713 | ||||||
Lease liabilities | (762 | ) | (1,674 | ) | ||||
Deferred revenue | (101 | ) | 67 | |||||
Deferred rent | 0 | (283 | ) | |||||
Net cash used in operating activities | (2,250 | ) | (2,854 | ) | ||||
Cash flows from investing activities: | ||||||||
Purchases of property and equipment | (125 | ) | (23 | ) | ||||
Net cash used in investing activities | (125 | ) | (23 | ) | ||||
Cash flows from financing activities: | ||||||||
Principal payments on capital leases | 0 | (18 | ) | |||||
Proceeds from issuance of common stock | 552 | 68 | ||||||
Proceeds received from exercise of preferred stock warrants | 60 | 0 | ||||||
Effect of Merger, net of transaction costs | 86,792 | — | ||||||
Repayments of loans payable | (3,459 | ) | (851 | ) | ||||
Proceeds from loans payable | 0 | 1,983 | ||||||
Net cash provided by financing activities | 83,945 | 1,182 | ||||||
Net change in cash and cash equivalents and restricted cash | $ | 81,570 | $ | (1,695 | ) | |||
Effect of change in foreign currency exchange rates on cash and cash equivalents and restricted cash | (28 | ) | 8 | |||||
Cash and cash equivalents and restricted cash at beginning of period | 8,709 | 9,605 | ||||||
Cash and cash equivalents and restricted cash at end of period | $ | 90,251 | $ | 7,918 | ||||
Supplemental disclosure of cash and non-cash transactions: | ||||||||
Cash paid for interest | $ | 88 | $ | 145 | ||||
Accrued acquisition of property and equipment | $ | 441 | $ | 0 | ||||
Issuance of Legacy Shapeways common stock upon conversion of convertible notes | $ | 5,913 | $ | 0 | ||||
Repurchase of Legacy Shapeways common stock | $ | (152 | ) | $ | 0 | |||
NOTE
Summary of Significant Accounting Policies
Presentation and Principles of Consolidation
GALILEO ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2020
(Unaudited)
The accompanying These unaudited condensed consolidated interim financial statements should be read in conjunctionalong with the Company’s Annual Report on Form 10-K for the year ended December 31, 2019final proxy statement/prospectus as filed with the SEC on March 26, 2020, which containsSeptember 7, 2021.
Emerging growth company
The Company is an “emerging growth company,”assets and liabilities as defined in Section 2(a)a result of the Securities Act,Business Combination.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being requiredcircumstances with regard to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company as an emerging growth company, can adoptof the Closing:
the Galileo trust account); and
Estimates
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that Actual results may differ from those estimates.
Ordinary shares subject
period are included as a component of other comprehensive loss within stockholders’ equity (deficit). Gains and losses from foreign currency transactions are included in net loss for the period.
Cash and Cash Equivalents
those institutions. The Company considers all short-termhighly liquid investments with an original maturitymaturities of three months or less when purchased to be cash equivalents. TheWhile cash held by financial institutions may at times exceed federally insured
Offering costs
Offering costs consist of underwriting, legal, accounting and other expenses incurred through the Initial Public Offeringbelieves that are directly relatedno material credit or market risk exposure exists due to the Initial Public Offering. Offering costs amounting to $3,187,305 were charged to shareholders’ equity upon the completionhigh quality of the Initial Public Offering.
GALILEO ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2020
(Unaudited)
Income taxes
The Company complies with the accounting and reporting requirements of ASC 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company’s management determined that the Cayman Islands is the Company’s only major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if any, as income tax expense. There were no unrecognized tax benefits as of March 31, 2020 and December 31, 2019 and no amounts accrued for interest and penalties. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
The Company may be subject to potential examination by foreign taxing authorities in the area of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with foreign tax laws. The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.
The Company is considered to be an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States.
Net income (loss) per ordinary share
Net income (loss) per share is computed by dividing net income (loss) by the weighted average number of ordinary shares outstanding for the period.institutions. The Company has not consideredexperienced any losses on such accounts. Restricted cash represents cash required to be held as collateral for the effect of warrants soldCompany’s credit cards and security deposit for our facility in the Initial Public OfferingNetherlands. Accordingly, these balances contain restrictions as to their availability and private placement to purchase an aggregate of 17,910,000 ordinary sharesusage and are classified as restricted cash in the calculationcondensed consolidated balance sheets.
September 30, 2021 | December 31, 2020 | |||||||
Cash and cash equivalents | $ | 90,108 | $ | 8,564 | ||||
Restricted cash | 143 | 145 | ||||||
$ | 90,251 | $ | 8,709 | |||||
The Company’s statementaccompanying condensed consolidated statements of operations includes a presentationand comprehensive loss. Given the nature and historical collectability of income (loss) per sharethe Company’s accounts receivable, an allowance for ordinary shares subject to redemption in a manner similar to the two-class method of income per share. Net income per ordinary share, basic and diluted, for redeemable ordinary shares is calculated by dividing the interest income earned on the Trust Account of $546,631 for the three months ended March 31,2020 by the weighted average number of redeemable ordinary shares outstanding for the period. Net loss for non-redeemable ordinary shares, basic and diluted, is calculated by dividing the net income (loss), less income attributable to redeemable ordinary shares of $546,631, by the weighted average number of non-redeemable ordinary shares outstanding for the period. Non-redeemable ordinary shares include the Founder Shares as these shares dodoubtful accounts was not have any redemption features and do not participate in the income earned on the Trust Account.
Concentration of credit risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, whichdeemed necessary at times, may exceed the Federal depository insurance coverage of $250,000. At March 31, 2020September 30, 2021 and December 31, 2019,2020.
Asset Category | Depreciable Life | |
Machinery and equipment | 5 years | |
Computers and IT equipment | 3 years | |
Furniture and fixtures | 7 years | |
Leasehold improvements | ** |
** | Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful life of the asset. |
Faira comparison of the undiscounted cash flows expected to be generated from the use of the asset group. If impairment is indicated, the asset is written down by the amount by which the carrying value of financial instruments
Thethe asset exceeds the related fair value of the asset with the related impairment charge recognized within the statements of operations and comprehensive loss. NaN impairment charges were recorded for the periods ended September 30, 2021 and December 31, 2020.
Recent accounting standards
Management doesoffice and manufacturing space, and equipment. The Company’s leases generally have initial terms ranging from 5 to 10 years and may include renewal options and rent escalation clauses. The Company is typically required to make fixed minimum rent payments relating to its right to use an underlying leased asset. Additionally, the Company’s leases do not believe that any recently issued, but not yet effective, accounting pronouncements,contain significantly restrictive covenants or residual value guarantees.
GALILEO ACQUISITION CORP.
MARCH 31, 2020
(Unaudited)
NOTE 3. INITIAL PUBLIC OFFERING
Pursuant
NOTE 4. PRIVATE PLACEMENT
Simultaneously with the closing of Galileo’s initial public offering, Galileo completed the Initial Public Offering, the Sponsorprivate sale of 4,110,000 warrants to Galileo’s sponsor and EarlyBirdCapital, andInc. at a purchase price of $1.00 per warrant (the “Private Warrants”). In connection with the Business Combination, Galileo’s sponsor exercised its designees purchasedright to convert the aggregate outstanding principal amount of the convertible promissory note issued by Galileo into an aggregate of 4,110,000 Private500,000 Sponsor Warrants, at $1.00 per Private Warrant, for an aggregate purchase price of $4,110,000. The Sponsor purchased an aggregate of 3,562,000 Private Warrants and EarlyBirdCapital and its designees purchased an aggregate of 548,000 Private Warrants. Each Private Warrant is exercisable to purchase one ordinary share at an exercise price of $11.50 per share (see Note 7). The proceeds from the Private Warrants were added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Warrants will expire worthless. There will be no redemption rights or liquidating distributions from the Trust Account with respectterms equivalents to the Private Warrants.
NOTE 5. RELATED PARTY TRANSACTIONS
Founder Shares
In August 2019,tax audit or the Company issued refinement of an aggregate of 2,875,000 ordinary shares (the “Founder Shares”) to the Sponsor for an aggregate purchase price of $25,000. On October 17, 2019, the Company effected a share dividend of 0.2 of a share for each ordinary share in issue, resulting in the Sponsor holding an aggregate of 3,450,000 Founder Shares. The Founder Shares include an aggregate of up to 450,000 shares subject to forfeiture by the Sponsor toestimate. To the extent that the underwriters’ over-allotmentfinal tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made, and could have a material impact on the Company’s financial condition and operating results. Carryforward attributes that were generated in tax years prior to those that remain open for examination may still be adjusted by relevant tax authorities upon examination if they either have been, or will be, used in a future period.
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Common stock warrants | 18,410,000 | 0 | 18,410,000 | 0 | ||||||||||||
Earnout Shares | 3,510,405 | 0 | 3,510,405 | 0 |
which certain investors agreed to purchase an aggregate of 7,500,000 shares of Common Stock for a purchase price of $10.00 per share and $75,000,000 in the aggregate (the “PIPE Investment”). At the Closing, the Company consummated the PIPE Investment.
Recapitalization | ||||
Cash - Galileo trust and cash, net of redemption | $ | 28,115 | ||
Cash - PIPE Investment, net of transaction costs | 75,000 | |||
Less: transaction costs and advisory fees allocated to equity | (16,323 | ) | ||
Effect of Merger, net of redemption, transaction costs and advisory costs | $ | 86,792 | ||
Recapitalization | ||||
Cash - Galileo trust and cash, net of redemption | $ | 28,115 | ||
Non-cash net working capital assumed from Galileo | 46 | |||
Less: fair value of Private and Sponsor Warrant liabilities | (11,865 | ) | ||
Less: transaction costs and advisory fees allocated to equity | (6,260 | ) | ||
Effect of Merger, net of redemption, transaction costs and advisory costs | $ | 10,036 | ||
Number of Shares | ||||
Common stock, outstanding prior to Business Combination | 13,800,000 | |||
Less: redemption of Galileo shares | (11,018,352 | ) | ||
Common stock of Galileo | 2,781,648 | |||
Galileo founder and representative shares, net of forfeited shares | 2,910,000 | |||
Shares issued in PIPE Investment | 7,500,000 | |||
Merger and PIPE Investment - common stock | 13,191,648 | |||
Legacy Shapeways shares - common stock (1) | 35,104,836 | |||
Total shares of common stock immediately after Business Combination | 48,296,484 | |||
(1) | Includes 3,510,405 Earnout Shares |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Major products/service lines: | ||||||||||||||||
Direct sales | $ | 5,985 | $ | 5,994 | $ | 19,068 | $ | 16,827 | ||||||||
Marketplace sales | 1,663 | 2,091 | 6,062 | 6,060 | ||||||||||||
Software | 68 | 22 | 224 | 141 | ||||||||||||
Total revenue | $ | 7,716 | $ | 8,107 | $ | 25,354 | $ | 23,028 | ||||||||
Timing of revenue recognition: | ||||||||||||||||
Products transferred at a point in time | $ | 1,663 | $ | 2,091 | $ | 6,062 | $ | 6,060 | ||||||||
Products and services transferred over time | 6,053 | 6,016 | 19,292 | 16,968 | ||||||||||||
Total revenue | $ | 7,716 | $ | 8,107 | $ | 25,354 | $ | 23,028 | ||||||||
Deferred Revenue | ||||
Balance at January 1, 2021 | $ | 753 | ||
Deferred revenue recognized during period | (25,354 | ) | ||
Additions to deferred revenue during period | 25,259 | |||
Balance at September 30, 2021 | $ | 658 | ||
September 30, 2021 | December 31, 2020 | |||||||
Raw materials | $ | 418 | $ | 521 | ||||
Work-in-process | 40 | 36 | ||||||
Finished goods | 115 | 170 | ||||||
Total | $ | 573 | $ | 727 | ||||
September 30, 2021 | December 31, 2020 | |||||||
Prepaid expenses | $ | 698 | $ | 646 | ||||
Security deposits | 259 | 259 | ||||||
VAT receivable | 950 | 975 | ||||||
Other current assets | 1 | 30 | ||||||
Total | $ | 1,908 | $ | 1,910 | ||||
September 30, 2021 | December 31, 2020 | |||||||
Machinery and equipment | $ | 1,388 | $ | 1,430 | ||||
Computers and IT equipment | 5,631 | 5,193 | ||||||
Furniture and fixtures | 49 | 50 | ||||||
Leasehold improvements | 2,477 | 2,520 | ||||||
9,545 | 9,193 | |||||||
Less: Accumulated depreciation | (8,455 | ) | (8,245 | ) | ||||
Property and equipment, net | $ | 1,090 | $ | 948 | ||||
September 30, 2021 | December 31, 2020 | |||||||
Accrued selling expenses | $ | 712 | $ | 947 | ||||
Accrued compensation | 757 | 876 | ||||||
Interest payable | — | 612 | ||||||
Taxes payable | 306 | 477 | ||||||
Accrued transaction costs | 450 | — | ||||||
Accrued acquisition of property and equipment | 441 | — | ||||||
Shapeways credits | 300 | 313 | ||||||
Other | 734 | 94 | ||||||
Total | $ | 3,700 | $ | 3,319 | ||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Operating lease expense | $ | 144 | $ | 482 | $ | 696 | $ | 1,585 | ||||||||
Finance lease expense | — | — | — | 16 | ||||||||||||
Interest expense on finance lease liabilities | — | — | — | 1 | ||||||||||||
Short-term lease expense | — | — | — | 14 | ||||||||||||
Total lease cost | $ | 144 | $ | 482 | $ | 696 | $ | 1,616 | ||||||||
September 30, 2021 | December 31, 2020 | |||||||
Assets: | ||||||||
Right-of-use | $ | 982 | $ | 2,102 | ||||
Total lease assets | $ | 982 | $ | 2,102 | ||||
Liabilities: | ||||||||
Current liabilities: | ||||||||
Operating lease liabilities, current | $ | 631 | $ | 1,222 | ||||
Non-current liabilities: | ||||||||
Operating lease liabilities, net of current portion | 499 | $ | 1,094 | |||||
Total lease liability | $ | 1,130 | $ | 2,316 | ||||
Nine Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Operating cash flows from operating leases | $ | 762 | $ | 1,754 | ||||
Operating cash flows from finance leases | — | 1 | ||||||
Financing cash flows from finance leases | — | 18 | ||||||
Lease liabilities arising from obtaining right-of-use | — | 4,025 |
Rest of 2021 | $ | 167 | ||
2022 | 680 | |||
2023 | 214 | |||
2024 | 132 | |||
2025 | 1 | |||
Total minimum lease payments | 1,194 | |||
Less effects of discounting | (64 | ) | ||
Present value of future minimum lease payments | $ | 1,130 | ||
September 30, 2021 | December 31, 2020 | |||||||
Dutch Landlord Loan | $ | 127 | $ | 163 | ||||
Term Loan | 0 | 3,423 | ||||||
Convertible Promissory Notes | 0 | 5,000 | ||||||
PPP Loan | 0 | 1,982 | ||||||
127 | 10,568 | |||||||
Less: current portion | (39 | ) | (8,332 | ) | ||||
Long-term debt | $ | 88 | $ | 2,236 | ||||
Promissory Note — Related Party
The Company’s Sponsor agreed to loanunderlying such warrants at the Company up to $300,000 to be usedtime of redemption and for the payment of costs relatedentire
Administrative Services Agreement
The Company entered into an agreement, commencing on October 17, 2019 through the earlier of the consummation of a Business Combination or the Company’s liquidation, to pay Ampla Capital, LLC, an affiliate of the Company’s Chief Financial Officer a monthly fee of approximately $3,000 for general and administrative services, including office space, utilities and secretarial support. For the three months ended March 31, 2020, the Company incurred and paid $9,000 in fees for these services.
GALILEO ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2020
(Unaudited)
Related Party Loans
In order to finance transaction costs in connection with a Business Combination, the Initial Shareholders, the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds from time to time or at any time, as may be required (“Working Capital Loans”). Each Working Capital Loan would be evidenced by a promissory note. The Working Capital Loans would either be paid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,000,000 of the Working Capital Loans may be converted into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Warrants. In the event that a Business Combination does not close, the Company may use a portion of the proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. As of March 31, 2020, no Working Capital Loans were outstanding.
NOTE 6. COMMITMENTS
Risks and Uncertainties
Management is currently evaluating the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as ofcontinuing each day thereafter until the date of these condensed financial statements. The condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Registration Rights
Pursuant to a registration rights agreement entered into on October 17, 2019, the holders of the Founder Shares, Private Warrants (and their underlying securities), Representative Shares (as a defined in Note 7) and any securities that may be issued upon conversion of the Working Capital Loans (and their underlying securities) will be entitled to registration rights. The holders of a majorityredemption. Certain of these securities are entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares are to be released from escrow. The holders of a majority of the Representative Shares, Private Warrants (and underlying securities) and securities issued in payment of Working Capital Loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. Notwithstanding anything herein to the contrary, EarlyBirdCapital and/or its designees may only make a demand registration (i) on one occasion and (ii) during the five-year period beginning on the effective date of the Initial Public Offering. In addition, the holders willconditions have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Business Combination Marketing Agreement
The Company engaged EarlyBirdCapital as an advisor in connection with a Business Combination to assist the Company in locating target businesses, holding meetings with its shareholders to discuss a potential Business Combination and the target business’ attributes, introduce the Company to potential investors that are interested in purchasing securities, assist the Company in obtaining shareholder approval for the Business Combination and assist the Company with its press releases and public filings in connection with a Business Combination. The Company will pay EarlyBirdCapital a cash fee equal to 3.5% of the gross proceeds of the Initial Public Offering, or $4,830,000, for such services only upon the consummation of a Business Combination. Of such amount, up to approximately 25% may be paid (subject to the Company’s discretion) to third parties who are investment banks or financial advisory firms not participating in Initial Public Offering that assist the Company in consummating its Business Combination. The election to make such payments to third parties will be solely at the discretion of the Company’s management team, and such third parties will be selected by the management team in their sole and absolute discretion. As of March 31, 2020, the above service had not been completed and accordingly, no amounts have been recorded in the accompanying condensed financial statements.
Additionally, the Company will pay EarlyBirdCapital a cash fee equalmet to 1.0% of the total consideration payable in the proposed Business Combination if it introduces the Company to the target business with which the Company completes a Business Combination; provided that the foregoing fee will not be paid prior to the date that is 90 days from the effective date of the Initial Public Offering, unless FINRA determines that such payment would not be deemed underwriters’ compensation in connection with the Initial Public Offering pursuant to FINRA Rule 5110(c)(3)(B)(ii).
GALILEO ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2020
(Unaudited)
NOTE 7. SHAREHOLDERS’ EQUITY
Preference Shares — The Company is authorized to issue 2,000,000 preference shares with a par value of $0.0001 per share with such designation, rights and preferences as may be determined from time to time by the Company’s Board of Directors. At March 31, 2020 and December 31, 2019, there were no preference shares issued or outstanding.
Ordinary Shares — The Company is authorized to issue 200,000,000 ordinary shares with a par value of $0.0001 per share. Holders of the ordinary shares are entitled to one vote for each share. At March 31, 2020 and December 31, 2019, there were 3,946,292 and 3,980,951 ordinary shares issued and outstanding, excluding 13,453,708 and 13,419,049 ordinary shares subject to possible redemption, respectively.
Warrants — The Public Warrants will become exercisable on the later of (a) the completion of a Business Combination and (b) 12 months from the closing of the Initial Public Offering. No Public Warrants will be exercisable for cash unless the Company has an effective and current registration statement covering the ordinary shares issuable upon exercise of the Public Warrants and a current prospectus relating to such ordinary shares. Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable upon the exercise of the Public Warrants is not effective within 90 days from the consummation of a Business Combination, the holders may, until such time as there is an effective registration statement and during any period when the Company shall have failed to maintain an effective registration statement, exercise the Public Warrants on a cashless basis pursuant to the exemption from registration provided by Section 3(a)(9) of the Securities Act provided that such exemption is available. If an exemption from registration is not available, holders will not be able to exercise their Public Warrants on a cashless basis. The Public Warrants will expire five years from the consummation of a Business Combination or earlier upon redemption or liquidation.
The Company may redeem the Public Warrants:
Warrants. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement.
Three and Nine Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Strike price | $ | 0.17 | $ | 0.37 | ||||
Expected term (in years) | 5.55 - 6.05 | 5.00 - 6.04 | ||||||
Expected volatility | 57.09% - 57.81 | % | 49.15% - 52.41 | % | ||||
Risk-free interest rate | 0.50% - 0.57 | % | 0.37% - 1.46 | % | ||||
Dividend yield | 0 | 0 |
Shares Underlying Options | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (in years) | ||||||||||
Outstanding at January 1, 2021 (as previously reported) | 8,247,340 | $ | 0.44 | 6.72 | ||||||||
Retroactive application of reverse recapitalization | (1,967,440 | ) | 0 | — | ||||||||
Outstanding as of January 1, 2021, effect of Merger | 6,279,900 | $ | 0.58 | 6.64 | ||||||||
Granted | 29,420 | 0.36 | 9.82 | |||||||||
Forfeited | (145,878 | ) | 0.43 | — | ||||||||
Exercised | (35,895 | ) | 0.43 | — | ||||||||
Outstanding at March 31, 2021 | 6,127,547 | $ | 0.58 | 6.53 | ||||||||
Granted | 0 | 0 | — | |||||||||
Forfeited | (39,309 | ) | 0.44 | — | ||||||||
Exercised | (63,506 | ) | 0.45 | — | ||||||||
Outstanding at June 30, 2021 | 6,024,732 | $ | 0.59 | 6.26 | ||||||||
Granted | 0 | 0 | — | |||||||||
Forfeited | (10,496 | ) | 0.40 | — | ||||||||
Exercised | (1,113,029 | ) | 0.44 | — | ||||||||
Outstanding at September 30, 2021 | 4,901,207 | $ | 0.62 | 6.80 | ||||||||
Exercisable at September 30, 2021 | 4,833,059 | $ | 0.62 | 6.79 | ||||||||
In addition, if (x) the Company issues additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue Company’s
Description | Level | September 30, 2021 | December 31, 2020 | |||||||||
Liabilities: | ||||||||||||
Warrant liabilities | 3 | $ | 6,777 | $ | 0 |
GALILEO ACQUISITION CORP.
September 30, 2021 | At Closing (September 29, 2021) | |||||||
Stock price on valuation date | $ | 7.70 | $ | 8.54 | ||||
Exercise price per share | $ | 11.50 | $ | 11.50 | ||||
Expected life | 5 years | 5 years | ||||||
Volatility | 34.8 | % | 43.9 | % | ||||
Risk-free rate | 1.0 | % | 1.0 | % | ||||
Dividend yield | 0 | % | 0 | % | ||||
Fair value per warrant | $ | 1.47 | $ | 2.57 | ||||
MARCH 31, 2020
(Unaudited)
Representative
Warrant Liabilities | ||||
Balance at December 31, 2020 | $ | 0 | ||
Additions pursuant to Merger | 11,865 | |||
Change in fair value | (5,088 | ) | ||
Balance at September 30, 2021 | $ | 6,777 | ||
In August 2019, has been estimated using the trading price of our
The Representative Shares have been deemed compensation by FINRADecember 31, 2020.
NOTE 8. FAIR VALUE MEASUREMENTS
At March 31, 2020, assets held in the Trust Account were comprised of $221 in cash and $138,960,889 at amortized cost in U.S. Treasury Bills. During the three months ended March 31, 2020, theRelated Party Note.
At December 31, 2019, assets held in the Trust Account were comprised of $220 in cash and $138,414,259 at amortized cost in U.S. Treasury Bills. During the period ended December 31, 2019, the Company has not withdrawn any interest income from the Trust Account to pay its tax obligations.
The gross holding losses and fair value of held-to-maturity securities at March 31, 2020 and December 31, 2019 are as follows:
Held-To-Maturity | Amortized Cost | Gross Holding Gains | Fair Value | |||||||||||
March 31, 2020 | U.S. Treasury Securities (Mature on 4/16/2020) | $ | 138,960,889 | $ | 91,939 | $ | 139,052,828 | |||||||
December 31, 2019 | U.S. Treasury Securities (Mature on 4/16/2020) | $ | 138,414,259 | $ | 26,719 | $ | 138,440,978 |
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
GALILEO ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2020
(Unaudited)
NOTE 9 — SUBSEQUENT EVENTS
The Company evaluated all known subsequent events and transactions that occurred after the balance sheet date up tothrough November 15, 2021, which is the date that thethese condensed consolidated financial statements were issued. Based upon this review, the Company did not identify anyavailable to be issued, and has determined that no subsequent events that would have required adjustmentoccurred requiring recognition or disclosure in thethese condensed consolidated financial statements.
References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Galileo Acquisition Corp. References to our “management” or our “management team” refer to our officers and directors, references to the “Sponsor” refer to Galileo Founders Holdings, L.P. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Special Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act that are not historical facts, and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements other than statements of historical fact included in this Form 10-Q including statements in this “Management’s
Overview
We arethe
Three Months Ended September 30, | Change | |||||||||||||||||||
(Dollars in thousands) | 2021 | 2020 | $ | % | ||||||||||||||||
Revenue | $ | 7,716 | $ | 8,107 | $ | (391 | ) | (5 | ) | % |
Three Months Ended September 30, | Change | |||||||||||||||||||
(Dollars in thousands) | 2021 | 2020 | $ | % | ||||||||||||||||
Cost of Revenue | $ | 4,055 | $ | 4,406 | $ | (351 | ) | (8 | ) | % |
Nine Months Ended September 30, | Change | |||||||||||||||
(Dollars in thousands) | 2021 | 2020 | $ | % | ||||||||||||
Revenue | $ | 25,354 | $ | 23,028 | $ | 2,326 | 10 | % |
Nine Months Ended September 30, | Change | |||||||||||||||
(Dollars in thousands) | 2021 | 2020 | $ | % | ||||||||||||
Cost of Revenue | $ | 13,271 | $ | 13,030 | $ | 241 | 2 | % |
The issuance of additional ordinary sharesDutch subsidiary, resulting in a Business Combination:
Similarly, if we issue debt securities, it could result in:
Shapeways has provided a valuation allowance for all of its deferred tax assets | ||
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities from inception to March 31, 2020 were organizational activities, those necessary to prepare for the Initial Public Offering, described below, and identifying a target company for a Business Combination. We do not expect to generate any operating revenues until after the completion of our Business Combination. We generate non-operating income in the form of interest income on marketable securities held in the Trust Account. We incur expenses as a result of beingour historical net losses in the jurisdictions in which we operate. Shapeways continues to assess our future taxable income by jurisdiction based on its recent historical operating
Forsupplemental basis. You should review the reconciliation of net income (loss) to Adjusted EBITDA below and not rely on any single financial measure to evaluate Shapeways’ business.
2020:
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
(Dollars in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Net income (loss) | $ | 2,552 | $ | (450 | ) | $ | 4,125 | $ | (2,920 | ) | ||||||
Debt forgiveness | — | — | (2,000 | ) | — | |||||||||||
Interest expense | 126 | 141 | 407 | 444 | ||||||||||||
Depreciation and amortization | 33 | 37 | 100 | 113 | ||||||||||||
Change in fair value of warrant liabilities | (5,088 | ) | — | (5,088 | ) | — | ||||||||||
Income tax benefit | — | — | (71 | ) | — | |||||||||||
Adjusted EBITDA | $ | (2,377 | ) | $ | (272 | ) | $ | (2,527 | ) | $ | (2,363 | ) | ||||
On October 22, 2019, we consummated
Following the Initial Public Offering, the exercise of the over-allotment optionapproximately $28.1 million and the sale of the Private Warrants,$75.0 million, respectively, to Shapeways’ balance sheet, for a total of $138,000,000 was placedapproximately $86.8 million in net proceeds after transaction costs.
Fornew digital manufacturing technologies. Additionally, Shapeways may engage in future acquisitions.
Nine Months Ended September 30, | ||||||||
(Dollars in thousands) | 2021 | 2020 | ||||||
Net cash used in operating activities | $ | (2,250 | ) | $ | (2,854 | ) | ||
Ned cash used in investing activities | (125 | ) | (23 | ) | ||||
Net cash provided by financing activities | 83,945 | 1,182 | ||||||
Net change in cash and cash equivalents and restricted cash | $ | 81,570 | $ | (1,695 | ) | |||
As$1.2 million.
As of March 31, 2020, we had cash of $453,512 held outside of the Trust Account. We intend to use the funds held outside the Trust Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination.
In order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete a Business Combination, we would repay such loaned amounts. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from our Trust Account would be used for such repayment. Up to $1,000,000 of such loans may be convertible into warrants identical to the Private Warrants, at a price of $1.00 per warrant at the option of the lender.
We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial Business Combination. Moreover, we may need to obtain additional financing either to complete our Business Combination or because we become obligated to redeem a significant number of our public shares upon completion of our Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination.
Off-balance sheet financing arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of March 31, 2020. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Contractual obligations
We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities.
We have an agreement to pay an affiliate of our Chief Financial Officer a monthly fee of $3,000 for office space, utilities and secretarial and administrative support to the Company. We began incurring these fees on October 17, 2019 and will continue to incur these fees monthly until the earlier of the completion of the Business Combination and the Company’s liquidation.
We engaged EarlyBirdCapital as an advisor in connection with a Business Combination to assist us in locating target businesses, holding meetings with our shareholders to discuss a potential Business Combination and the target business’ attributes, introduce us to potential investors that are interested in purchasing securities, assist us in obtaining shareholder approval for the Business Combination and assist us with our press releases and public filings in connection with a Business Combination. We will pay EarlyBirdCapital a cash fee equal to 3.5% of the gross proceeds of the Initial Public Offering, or $4,830,000, for such services only upon the consummation of a Business Combination. Of such amount, up to approximately 25% may be paid (subject to our discretion) to third parties who are investment banks or financial advisory firms not participating in Initial Public Offering that assist us in consummating its Business Combination. The election to make such payments to third parties will be solely at the discretion of our management team, and such third parties will be selected by the management team in their sole and absolute discretion.
Additionally, we will pay EarlyBirdCapital a cash fee equal to 1.0% of the total consideration payable in the proposed Business Combination if it introduces us to the target business with which we complete a Business Combination; provided that the foregoing fee will not be paid prior to the date that is 90 days from the effective date of the Initial Public Offering, unless FINRA determines that such payment would not be deemed underwriters’ compensation in connection with the Initial Public Offering pursuant to FINRA Rule 5110(c)(3)(B)(ii).
Critical Accounting Policies
The preparation of condensed financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities disclosure of contingent assets$2.4 million.
Ordinary shares subjectpolicies requires significant judgments and estimates in the preparation of its consolidated financial statements:
We accounttransfer multiple software elements to the customer. Revenue from sale of software may be recognized over the life of the associated software contract or as services are performed, depending on the nature of the services being provided. Judgment is required to determine the separate performance obligations present in a given contract, which Shapeways has concluded are generally capable of being distinct and accounted for our ordinary shares subjectas separate performance obligations. Shapeways uses standalone selling price (“SSP”) to possible redemptionallocate revenue to each performance obligation. Significant judgment is required to determine the SSP for each distinct performance obligation in accordance witha contract.
Net income (loss) per ordinary share
We applyprofessional judgment, is conducted at the two-class method in calculating earnings per share. Net income per ordinary share, basictime of warrant issuance and dilutedas of each subsequent quarterly period end date while the warrants are outstanding.
Sponsor Warrants were estimated using a Binomial Lattice Model.
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our
Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the recent coronavirus (COVID-19) outbreak.
In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, which has and is continuing to spread throughout other parts of the world, including the United States. On January 30, 2020, the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public Health Emergency of International Concern.” On January 31, 2020, U.S. Health and Human Services Secretary Alex M. Azar II declared a public health emergency for the United States to aid the U.S. healthcare community in responding to COVID-19, and on March 11, 2020 the World Health Organization characterized the outbreak as a “pandemic.” COVID-19 has resulted in a widespread health crisis that has adversely affected the economies and financial markets worldwide. The business of any potential target business with which we consummate a business combination could be materially and adversely affected. Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit the ability to have meetings with potential investors or the target company’s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search for a business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19 or other matters of global concern continue for an extended period of time, our ability to consummate a business combination, or the operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected.
On October 22, 2019, we consummated our Initial Public Offering
Simultaneously with the consummation of the Initial Public Offering, we consummated a private placement of 4,110,000 Private Warrants to our Sponsor at a price of $1.00 per Private Warrant, generating total proceeds of $4,110,000. Such securities were issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
The Private Warrants are the same as the warrants underlying the Units sold in the Initial Public Offering, except that Private Warrants are not transferable, assignable or salable until the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants are exercisable on a cashless basis and are non-redeemable so long as they are held by the initial purchasers or their permitted transferees.
Of the gross proceeds received from the Initial Public Offering, the full exercise of the over-allotment option and the Private Warrants, $138,000,000 was placed in the Trust Account.
We paid a total of $2,760,000 underwriting discounts and commissions and $427,305 for other costs and expenses related to the Initial Public Offering.
For a description of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Quarterly Report.
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.
* | Filed |
** | Furnished |
Shapeways Holdings, Inc. | ||||
| ||||
Dated: November 15, 2021 | ||||
By: /s/ Jennifer Walsh | ||||
Jennifer Walsh | ||||
Chief Financial Officer | ||||
(Principal Financial and Accounting Officer) |